nep-dev New Economics Papers
on Development
Issue of 2005‒10‒04
fifteen papers chosen by
Jeong-Joon Lee
Towson University

  1. Regional and personal inequality in welfare in pre-WWII Japan (1892-1941): Physical stature, income, and health By Jean-Pascal Bassino
  2. Trends in Regional Disparity in Human and Social Development in India By Dholakia Ravindra H
  3. Organisational morphology of rural industries in liberalised India: A study of West Bengal By Dibyendu S. Maiti
  4. On the non-random distribution of educational deprivation of children in India By Mothuri Venkatanarayana
  5. The Dragon vs the Elephant: Comparative analysis of innovation capability in the telecommunications equipment industry in China and India By Sunil Mani
  6. Unemployment in Kerala at the turn of the century: Insights from CDS Gulf migration studies By K.C. Zachariah; S. Irudaya Rajan
  7. Taxing powers and developmental role of the Indian states: A study with reference to Kerala By R. Mohan; D. Shyjan
  8. Social group disparities and poverty in India By Rohit Mutatkar
  9. Public Expenditures, Bureaucratic Corruption and Economic Development By K Blackburn; R Sarmah
  10. Selection and Reporting Bias in Household Surveys of Child Labor: Evidence from Tanzania By Jessica Holmes; Paul Sommers
  11. Understanding the Effects of Siblings on Child Mortality: Evidence from India By Gerald Makepeace; Sarmistha Pal
  12. Birth Spacing and Child Survival: Comparative Evidence from India and Pakistan* By Pushkar Maitra; Sarmistha Pal
  13. Sociopolitical Instability and Long Run Economic Growth: a Cross Country Empirical Investigation." By James L.Butkiewicz ; Halit Yanikkaya
  14. Capital quality improvement and the sources of growth in the euro area By Plutarchos Sakellaris; Focco W. Vijselaar
  15. Quality of public finances and growth By António Afonso; Werner Ebert; Ludger Schuknecht; Michael Thöne

  1. By: Jean-Pascal Bassino
    Abstract: This paper investigates the relationship between physical stature, per capita income, health,and regional inequality in Japan at the prefecture-level for the period 1892-1941. The analysis shows that inequality in income and access to health services explains differences in average body height of the population across the 47 Japanese prefectures during this period and that variation in income contributed to changes in height during the 1930s. Annual regional time series of height indicate that Japan experienced a regional convergence in biological welfare before 1914, and that a divergence occurred during the interwar period; personal inequality followed a similar pattern.
    Keywords: physical stature, height, health, midwives, inequality, income distribution, regional convergence, Japan
    JEL: I31 N35 N95 O15
    Date: 2005–09
  2. By: Dholakia Ravindra H
    Abstract: In the present paper, we have examined trends in regional disparity in human and social development by considering numerous indicators other than State Income. We found no support to the general impression prevailing in the recent literature that disparity is increasing over the last two decades when we subjected the trend to statistical significance test. We considered numerous output as well as the input indicators for the purpose. In very few indicators, the disparity showed an increase, whereas in a large number of indicators it either remained the same or actually declined over the last two decades. The state governments’ efforts in the social sectors were perhaps a major reason for the outcome. Except education, in all other social sub-sectors, the interstate disparity in the government effort markedly declined during the 1990s compared to the 1980s. In education, it remained the same. Our findings in this paper point to a very clear policy prescription. The social and human development is considered by all the state governments as very important and a priority sector in their development strategy. The way they are making efforts in these directions is reducing disparity across states although each state has been acting on its own. This is perhaps because of the felt need of people and the polity in states. Explicit objective of reducing regional disparity in social and human development in the central planning may not, therefore, be specially required. Augmenting the revenue resources of states allowing the states to access public borrowings directly would enable most of them to concentrate on their priority areas – based on the local felt need. It is likely to address the issue of regional imbalance and disparity in a much better and efficient way without imposing excess burden since it would allow exploiting complementarities in growth and equity.
    Date: 2005–09–23
  3. By: Dibyendu S. Maiti (Centre for Development Studies)
    Abstract: Recent interest on rural industries derives from recognition of thelimits of agriculture and organised manufacturing sector in employment generation especially during the post-liberalisation period in India. Historically, industrial development of the West and the East presentcontrasting pictures of rural industries. One, the linearity model foundedon the historical experience of the West, holds that development impliesa movement away from traditional subsistence production in rural areas to modern industrial production in urban centres. The other, the EastAsian Experience has shown that the growth potential of rural industriesis considerable given the under-utilisation of the physical labour and the entrepreneurial ability of rural people. A combination of putting out system and subcontracting system - along with modern factory and industrial cooperatives - has persisted in the rural manufacturing sector even in the era of economic liberalisation. We find differential capital endowments and socio-economic constraints of rural artisans reflecting extensive division of labour, specialisation and fragmentation of the labour process. These do not satisfy the requirements of the linearity model founded in advanced capitalist countries.
    Keywords: Rural industry, production organisation, linearity model, transaction cost
    JEL: O18 R12
    Date: 2005–06
  4. By: Mothuri Venkatanarayana (Centre for Development Studies)
    Abstract: The emphasis on education assumes importance given the recent recognition of human capital, human rights and human development perspectives of development. Hence educational deprivation is recognised as the primary agent of human deprivation and all necessary measuresare required to ensure minimum education for every child. Such auniversal recognition emanates from the given magnitude of educationally deprived children all around the world. On this premise,this is an attempt at examining the levels and inequities associated withthe phenomenon of educational deprivation of children during 1990's in India. This exercise provides a detailed exposition of the household characteristics of the deprived children based on information obtained in National Sample Survey Organisation (NSSO). The persistence of educational deprivation among children in India is due to socio-economic deprivation in general; however, it remains debatable but whether the remedy lies in making the schooling provision universal. This paper argues that the provision may be necessary but not a sufficient condition to accomplish the dream goal of universal elementary education. Alternatively it argues for a greater role of the state to ensure the enabling conditions in the household domain; in otherwords, the state has the responsibility of ensuring the well-being of all children on an equal footing. The state's responsibility is of equal importance of that of the parents.
    Keywords: India, Deprivation, Educationally Deprived Children, Child Labour, Educational Inequalities, Group Inequalities
    JEL: I2 I20 I28 R12 J21 J23
    Date: 2005–07
  5. By: Sunil Mani (Centre for Development Studies)
    Abstract: China and India have one of the largest telecommunications equipment markets in the world. The paper employs a sectoral system of innovation framework towards understanding the differential outcomes in innovation capability building in the industry achieved by China and India. The countries have pursued widely diverging strategies for developing their domestic innovation capability. India followed a very rigid policy of indigenous development of domestic technologies by establishing a stand-alone public laboratory that developed state-of-the art switching technologies. These were then transferred to manufacturing enterprises in both public and private sectors. The enterprises themselves did not have any in-house R&D capability. The public laboratory was also not given any strategic direction, even though it was technologically speaking, very competent. Consequently the country, despite possessing good quality human resource was unable to keep pace with changes in the technology frontier and the equipment industry has now become essentially dominated by affiliates of MNCs. China, on the contrary, first depended on MNCs for her technology needs in this area. But subsequently encouraged the emergence of three national champions, two of which are erstwhile public laboratories. The country has built up considerable hardware capability in both fixed line and mobile communications technology and has also emerged as a major player in world markets. Although the sectoral system of innovation in both the countries were promoted and nurtured by the state through a variety of instruments, the quality of such interventionist strategy is found to be better in China. The final outcome proves this line of argument.
    Keywords: Innovation capability, China, India, Telecommunications industry, Digital switching systems, Mobile telephony
    JEL: L63 O31 O32 O38
    Date: 2005–07
  6. By: K.C. Zachariah (Centre for Development Studies); S. Irudaya Rajan (Centre for Development Studies)
    Abstract: This Working Paper is about the unemployment situation in Kerala. It is based on the findings of the two Gulf Migration Studies, Kerala Migration Study (KMS) and South Asia Migration Study (SMS), conducted by the authors at the Centre for Development Studies, Thiruvananthapuram, during the last five years. The paper gives measures of unemployment rates in the state in 1998 and 2003, examines their variation by geographic regions, such as districts and taluks, by demographic characteristics such as age, sex and marital status, by sociocultural variables such as education, religion and community, and by economic indicators of households such as remittances received, quality of housing, possession of consumer durables, etc. On the basis of the trends and differentials in the profile of the unemployed, the study provides a few insights, some quite unorthodox, on the factors associated with the increase in the unemployment rate in the state during 1998-2003. As far as possible, all the assertions and conclusions are supported by factual data from the two surveys.
    Keywords: International Migration, Remittances, Unemployment, Replacement Migration, Kerala
    JEL: J21 J23
    Date: 2005–08
  7. By: R. Mohan (Centre for Development Studies); D. Shyjan (Centre for Development Studies)
    Abstract: The study analyses whether the growing State Domestic Product (SDP) of Kerala since the latter half of the 1980s, has acted as a larger resource base for the State and finds that it has not. While the inability to fully tap the existing resource potential could be cited as a reason, the paper argues that the main constraint is the limited taxing powers of the States. The Study concludes that the power to tax the services should be devolved from the Centre to the States, lest the fiscal dispossession should affect the sustainability of achievements, which made the development experience of Kerala unique.
    Keywords: Revenue Receipts, Tax Effort, SDP
    JEL: E62 E69
    Date: 2005–08
  8. By: Rohit Mutatkar (Indira Gandhi Institute of Development Research)
    Abstract: This paper seeks to provide a profile of social group disparities and poverty in India, where social groups are classified as scheduled caste, scheduled tribe and other social groups, and examine the factors underlying differences in levels of living between these groups and for each group separately. The paper argues that social group disparities in levels of living are the result of historically rooted `social disadvantages' for scheduled castes and scheduled tribes, by way of social exclusion and physical exclusion respectively, which continue to operate in contemporary Indian society.
    Keywords: Poverty, Scheduled Caste, Scheduled Tribe, Exclusion, India
    JEL: I3
    Date: 2005–09
  9. By: K Blackburn; R Sarmah
    Abstract: This paper presents an analysis of the joint, endogenous determination of bureaucratic corruption, economic development and demographic transition. The analysis is based on an overlapping generations model in which reproductive agents mature safely through two periods of life and face a probability of surviving for a third period. This survival probability depends on the provision of public goods and services which may be compromised by corrupt activities on the partof public officials. The dynamic general equilibrium of the economyis characterised by multiple development regimes, transition betweenwhich may or may not be feasible. In accordance with empirical evidence, the model predicts that low (high) levels of development are associated with high (low) levels of corruption and low (high) rates of life expectancy.
    Date: 2005
  10. By: Jessica Holmes; Paul Sommers
    Date: 2005
  11. By: Gerald Makepeace (Cardiff Business School); Sarmistha Pal (Department of Economics & Finance, Brunel University)
    Abstract: This paper examines the efffect of siblings on child mortality in the Indian state of West Bengal arguing that prior and posterior spacing between consecutive siblings are important measures of the intensity of competition among siblings for limited resources. Parental decisions regarding spacing is endogenous to allocation of resources though available estimates of child mortality largely ignore it. To correct for this possible endogeneity bias, we allow for family specific unobserved heterogeneity and model birth spacing and child mortality as correlated processes within a sequential framework. These corrected estimates suggest: (a) the hazard of prior spacing may increase while that of posterior spacing decrease with mother’s literacy and household assets. (b) the chances of child survival increase with an increase in both prior and posterior birth interval but decrease with the birth of a twin. (c) prior and posterior birth intervals have different effects on young boys and girls, which, in turn, reflect the nature of decisions made by resource constrained parents characterised by pro-male bias.
    Keywords: Sibling competition, Age and gender composition, Birth spacing, Child mortality, Pro-male bias, Unobserved heterogeneity.
    JEL: D13 I12 O15
    Date: 2005–09–27
  12. By: Pushkar Maitra (Monash University); Sarmistha Pal (Brunel University)
    Abstract: In view of higher fertility and mortality rates in Pakistan compared to India, this paper examines the two-way relationship between birth interval and child mortality and compares the behaviour of households in the Indian and Pakistani provinces of Punjab. Birth interval and child survival are modelled here as correlated hazard processes to address the bias generated by the simultaneity between spacing and survival. We find evidence of significant mutual dependence between birth interval and child survival in both samples. We also identify a close correspondence between birth interval and duration of breastfeeding and argue that the duration of breastfeeding is a good instrument of birth spacing in our samples. There are also interesting differences between Indian and Pakistani households with respect to effects of son preference and female literacy. We argue that part of these differences could be explained by differences in religion and state policies in these two neighbouring states.
    Keywords: Birth spacing, Child survival, Sibling competition and child replacement effects, Religion and state policy, Correlated hazards models, Simultaneity bias.
    JEL: C41 C24 J13 O10
    Date: 2005–09–27
  13. By: James L.Butkiewicz  (Department of Economics,University of Delaware); Halit Yanikkaya (Department of Economics, Celal Bayar University)
    Abstract: This paper investigates the effects of sociopolitical instability on long-run growth. The impacts of socio-political instability are estimated by cross-country growth regressions for a panel of nations over a thirty-year sample period. Overall, our results are consistent with the existing literature implying that, at best, a weak relationship exists between sociopolitical instability and growth. More importantly, this relationship depends crucially on the measure of sociopolitical instability used. Specifically, while government instability and social instability measures typically have weak and, in some instances, a positive, relationship with growth, political violence indicators have a negative and significant impact on growth. Furthermore, our results indicate that sociopolitical instability has larger adverse effects on countries with higher levels of development and democracy. Although the issue of potential reverse causality is widely emphasized in the literature, our IV estimation results imply that simultaneity is not a severe problem for estimates of empirical growth models including sociopolitical instability measures. On the contrary, the effects of outlier countries and, to a lesser degree, parameter heterogeneity are much more serious problems for estimates using these variables. Length pages: 30 pages
    Keywords: Socio-political Instability; Political Violence; Growth
    JEL: O40 K40
    Date: 2004
  14. By: Plutarchos Sakellaris (Department of Economics, Athens University of Economics and Business); Focco W. Vijselaar (Monetary and Economic Policy Department, De Nederlandsche Bank N.V.)
    Abstract: Capital quality improvement is a general phenomenon. Therefore quality correction is needed in price indexes. There is substantial evidence of biases in the official price indexes of capital equipment. We apply to euro area statistics estimates of these biases based on US data thus deriving quality-adjusted price indexes. Adjusted for quality, productive capital stocks of equipment and software grow on average 3 percentage points faster annually - a doubling of their growth rates. Quality-adjusted output grows 0.46 percentage points faster annually - a 20 percent increase. In terms of growth accounting, quality adjustment subtracts 11 percentage points from the share of TFP in aggregate growth and adds them to the share of equipment stock. For the 1990s only the difference is even higher: 14 percentage points. When all is told, embodied technological change accounts for 46 percent of (quality-adjusted) output growth in the euro area over the period 1982 to 2000.
    Keywords: output growth, embodied technological change, equipment investment, investment price deflators, euro area.
    JEL: O3 O47 D24 E22
    Date: 2004–06
  15. By: António Afonso (European Central Bank, Kaiserstraße 29, D-60311 Frankfurt am Main, Germany.); Werner Ebert (Bundesministerium der Finanzen, Detlev-Rohwedder-Haus,Wilhelmstrße 97, D-10117 Berlin, Germany.); Ludger Schuknecht (European Central Bank, Kaiserstraße 29, D-60311 Frankfurt am Main, Germany.); Michael Thöne (Finanzwissenschaftliches Forschungsinstitut (FiFo), Köln University, Zülpicher Str. 182, D-50937 Köln, Germany.)
    Abstract: In this paper we review the linkages between the quality of public finances, that is, the level and composition of public expenditure and its financing via revenue and deficits, and economic growth. We review the various channels through which public finances affect growth and its underlying determinants (institutional framework, employment, savings and investment, innovation). The paper addresses the approaches used to assess the performance and efficiency of public spending, and surveys the empirical findings on the impact of fiscal variables on sustained economic growth.
    Keywords: quality of public finances, efficiency, growth
    JEL: H50 O40
    Date: 2005–02

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